Question 2. Below is a list of cash flow movements through Smart Paints Ltd, a newly...

 

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Question 2. Below is a list of cash flow movements through Smart Paints Ltd, a newly formed retail company, current account for July 2021. The company sells specialized paints through its only shop: Date 1st July 3rd July 7th July 12th July 20th July 24th July 25th July 31st July 31st July 31st July 31st July 31st July Required: a) Transaction Received cash from owners for shares Finalized rental agreement for shop paying 3 months' rent in advance Received bank loan from HSBC Purchase point of sale equipment for cash will depreciate over 5 years Purchased specialized paint inventory Paid for shop opening event Sold specialized paints for cash that had originally cost 15,000 Paid interest on bank loan Transferred cash to an easy access deposit account which has no notice period to access funds and a 2% interest rate per annum. Paid staff salaries Paid interim dividend Amount (£) 50,000 (4,500) 1) Operating Cash flows 2) Investing Cash flows 3) Financing Cash flows 50,000 (5,000) (30,000) (750) 30,000 (500) (30,000) (8,000) (1,000) 3 of 8 | Pages Showing your workings, compute the following cash flows for Smart Paints Ltd: (8 marks) b) What is the amount of Smart Paints Cash and Cash Equivalents as at 31st July 2021. (2 marks) Question 2. Below is a list of cash flow movements through Smart Paints Ltd, a newly formed retail company, current account for July 2021. The company sells specialized paints through its only shop: Date 1st July 3rd July 7th July 12th July 20th July 24th July 25th July 31st July 31st July 31st July 31st July 31st July Required: a) Transaction Received cash from owners for shares Finalized rental agreement for shop paying 3 months' rent in advance Received bank loan from HSBC Purchase point of sale equipment for cash will depreciate over 5 years Purchased specialized paint inventory Paid for shop opening event Sold specialized paints for cash that had originally cost 15,000 Paid interest on bank loan Transferred cash to an easy access deposit account which has no notice period to access funds and a 2% interest rate per annum. Paid staff salaries Paid interim dividend Amount (£) 50,000 (4,500) 1) Operating Cash flows 2) Investing Cash flows 3) Financing Cash flows 50,000 (5,000) (30,000) (750) 30,000 (500) (30,000) (8,000) (1,000) 3 of 8 | Pages Showing your workings, compute the following cash flows for Smart Paints Ltd: (8 marks) b) What is the amount of Smart Paints Cash and Cash Equivalents as at 31st July 2021. (2 marks)

Answer rating: 100% (QA)

a Show ing your workings compute the following cash flows for Smart P aints Ltd 1 Operating Cash flo... View the full answer